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New York State Sues Administrator of Workers' Compensation Insurance Company

Whether you are a small business owner in New York or an employee of a business in New York you may be aware what workers' compensation insurance is.  Workers' compensation insurance is an insurance that covers an employee in the event that they are injured due to a work related accident.  New York businesses who pay into workers' compensation insurance expect that the workers' compensation premium they are paying every month will cover the amount of workers' compensation insurance they need for their employees but according to a recent article in the New York Times there is one company that offers workers' compensation insurance to companies that allegedly conducted bad business in their workers' compensation coverage and is now being sued by the New York Workers' Compensation Board and the New York attorney general's office. 

CRM Holdings, a workers' compensation insurance company to many businesses in New York State, is recently had a lawsuit filed against them by New York State seeking $405 Million in damages.  According to the New York Workers' Compensation Board and the attorney generals office CRM Holdings for years has been charging companies an artificially low premium leaving New York businesses inadequately covered as far as workers' compensation benefits go. 

The attorney general's office also informed the New York Times that they will be filing an additional lawsuit against CRM Holdings within the next week for business fraud, security fraud and deceptive and illegal practices to attract business.  In fact, CRM's extremely low premiums actually has caused over 10 workers' compensation insurance trusts to go out of business due to the extremely low rates that CRM would offer. 

CRM Holdings has not said much about the lawsuit for false workers' compensation coverage amounts yet except that they are denying the claims. 

Having adequate workers' compensation insurance is very important for both a business owner and an employee and falsely advertising to businesses that they are getting more for their money and paying lower premiums when they are actually unknowingly inadequately covered is not a good situation to be in.  Good thing for many New York small and medium sized business owners and employees that this company's secret was unveiled and is now being addressed at the State Supreme Court in Albany, NY.